This refers to the inspection conducted between July 1, 1997, and August
16, 1997, at the Susquehanna Steam Electric Station in Berwick, Pennsylvania,
the findings of which were discussed with members of your staff during
exit meetings on August 26, 1997, and September 11, 1997. During the inspection,
apparent violations were identified related to the misalignment of the
'A' emergency diesel generator (EDG), which was discovered by the NRC
on July 11, 1997. The inspection report addressing these issues was previously
forwarded to you on October 27, 1997. On December 16, 1997, a predecisional
enforcement conference (conference) was conducted with you and members
of your staff, to discuss the violations, their causes, and your corrective
actions.

Based on the information developed during the inspection and the information
provided during the conference, the NRC has determined that a violation
of NRC requirements occurred. The violation involved your failure to establish
adequate controls for the alignment of the emergency diesel generator
(EDG) woodward governor controls contrary to 10 CFR Part 50, Appendix
B, Criterion II, "Quality Assurance." The violation is cited in the enclosed
Notice of Violation and Proposed Imposition of Civil Penalty (Notice)
and the circumstances surrounding it are described in detail in the subject
inspection report.

Specifically, the load limit setting for the 'A' EDG governor was not
adequately controlled in that the setting was not maintained in the required
100% load position. The load limit setting was misaligned sometime between
June 16, 1997, when an operability surveillance test was satisfactorily
performed and the setting was left in the 100% load position, and July
11, 1997, when the NRC found the setting at approximately 35%. Due to
the misalignment, during an accident, the 'A' EDG would not have started
within the required time and would not have been able to supply the required
load as designed. As a result of the misalignment, the 'A' EDG was inoperable
for an indeterminate period of time between June 16, 1997 and July 11,
1997 while both units were operating. Your subsequent investigation of
the misalignment did not determine the proximate cause. However, a work
sequence error, inadvertent human interaction, or tampering could not
be eliminated as potential proximate causes.

During the time that the 'A' EDG was inoperable, only three EDGs were
operable. Technical Specifications require four EDGs to be operable during
plant operations. With the 'A' EDG inoperable, the units did not have
the capability to withstand a single failure of another EDG following
a design basis accident. Additionally, there was the potential that emergency
core cooling system (ECCS) motors fed from the 'A' EDG operating in this
degraded condition could have been damaged due to operation of the EDG
at low frequency. The failure to adequately control the EDG load limit
setting caused important safety-related equipment to be inoperable for
an indeterminate period, thus degrading the plant's capability to respond
to design basis events. Therefore, this violation has been categorized
in accordance with the "General Statement of Policy and Procedure for
NRC Enforcement Actions" (Enforcement Policy), NUREG-1600, at Severity
Level III.

Further, the NRC is concerned that you failed to implement effective
controls for the alignment of the Woodward governor controls despite the
fact that multiple events involving the functioning of Woodward governors
have been identified in the industry between 1985 and the present, including
three at SSES. Also, the NRC is concerned that your investigation of this
event could not preclude tampering as a cause and that the investigations
revealed at least two other recent instances of unexplained misalignment
of out-of-service EDGs similar to the misalignment of the 'A' EDG. It
appears that personnel performance issues persist at SSES and there is
an adverse trend in equipment status control events.

In accordance with the Enforcement Policy, a base civil penalty in the
amount of $55,000 is considered for a Severity Level III violation. Because
your facility has been the subject of escalated enforcement actions within
the last 2 years,(1) the NRC considered
whether credit was warranted for Identification and Corrective
Action in accordance with the civil penalty assessment process in
Section VI.B.2 of the Enforcement Policy." Credit was not warranted for
identification because the violation was identified by the NRC. Additionally,
you had prior opportunities to identify the need for additional controls
on Woodward governors. Credit was warranted for corrective actions because
your corrective actions were considered prompt and comprehensive. Those
actions, as described at the conference, included: 1) restoration of the
'A' EDG governor to the correct alignment and verification that the other
EDGs and other safety related equipment were properly aligned; 2) installation
of protective covers on the EDG Woodward governor controls; 3) review
and curtailment of access to vital areas; 4) assessment of EDG maintenance
work practices; 5) enhancements to security and operations procedures
for responding to status control events; and 6) communications with employees
concerning this event and ongoing activities to improve industrial relations.

Therefore, to emphasize the importance of controlling the status of safety
related equipment and of prompt identification of violations, and in recognition
of your previous escalated enforcement actions, I have been authorized,
after consultation with the Director, Office of Enforcement, to issue
the enclosed Notice of Violation and Proposed Imposition of Civil Penalty
(Notice) in the base amount of $55,000 for the Severity Level III violation.

You are required to respond to this letter and should follow the instructions
specified in the enclosed Notice when preparing your response. The NRC
will use your response, in part, to determine whether further enforcement
action is necessary to ensure compliance with regulatory requirements.

In accordance with 10 CFR 2.790 of the NRC's "Rules of Practice," a copy
of this letter, its enclosure, and your response will be placed in the
NRC Public Document Room (PDR).

Sincerely,
Hubert J. Miller
Regional Administrator

Docket Nos. 50-387; 50-388
License Nos. NPF-14; NPF-22

Enclosure: Notice of Violation and Proposed Imposition of Civil Penalty

During an NRC inspection conducted from July 1 to August 16, 1997, for
which exit meetings were held on August 28, 1997, and September 11, 1997,
a violation of NRC requirements was identified. In accordance with the
"General Statement of Policy and Procedures for NRC Enforcement Actions,"
NUREG-1600, the NRC proposes to impose a civil penalty pursuant to Section
234 of the Atomic Energy Act of 1954, as amended (Act), 42 U.S.C. 2282,
and 10 CFR 2.205. The particular violation and associated civil penalty
are set forth below:

10 CFR Part 50, Appendix B, Criterion II, "Quality Assurance
Program", requires, in part, that activities affecting quality be performed
under suitably controlled conditions including special controls needed
to attain the required quality.

Contrary to the above, as of July 11, 1997, the licensee failed to establish
adequate controls for activities affecting the quality of the emergency
diesel generators (EDGs). Specifically, the licensee failed to establish
adequate controls for the positioning of the speed and load controls of
the EDG Woodward governors allowing the 'A' EDG load limit control to
be misaligned sometime between June 16, 1997, when the load limit setting
was left in the required 100% load position, and July 11, 1997, when the
load limit setting was found at approximately 35%. Due to the misalignment,
during an accident, the 'A' EDG would not have started within the required
time and would not have been able to supply the required load as designed.
As a result of the misalignment, the 'A' EDG was inoperable for an indeterminate
period of time between June 16, 1997 and July 11, 1997, while both units
were operating, contrary to Technical Specification 3.8.1. (01013)

Pursuant to the provisions of 10 CFR 2.201, Pennsylvania Power and Light
Company (Licensee) is hereby required to submit a written statement or
explanation to the Director, Office of Enforcement, U.S. Nuclear Regulatory
Commission, within 30 days of the date of this Notice of Violation
and Proposed Imposition of Civil Penalty (Notice). This reply should be
clearly marked as a "Reply to a Notice of Violation" and should include
for each alleged violation: (1) admission or denial of the alleged
violation, (2) the reasons for the violation if admitted, and if
denied, the reasons why, (3) the corrective steps that have been taken
and the results achieved, (4) the corrective steps that will be taken
to avoid further violations, and (5) the date when full compliance will
be achieved. If an adequate reply is not received within the time specified
in this Notice, an Order or a Demand for Information may be issued as
why the license should not be modified, suspended, or revoked or why such
other action as may be proper should not be taken. Consideration may be
given to extending the response time for good cause shown. Under the authority
of Section 182 of the Act, 42 U.S.C. 2232, this response shall be submitted
under oath or affirmation.

Within the same time as provided for the response required above under
10 CFR 2.201, the Licensee may pay the civil penalty by letter
addressed to the Director, Office of Enforcement, U.S. Nuclear Regulatory
Commission, with a check, draft, money order, or electronic transfer payable
to the Treasurer of the United States in the amount of the civil penalty
proposed above, or the cumulative amount of the civil penalties if more
than one civil penalty is proposed, or may protest imposition of the civil
penalty in whole or in part, by a written answer addressed to the Director,
Office of Enforcement, U.S. Nuclear Regulatory Commission. Should the
Licensee fail to answer within the time specified, an order imposing the
civil penalty will be issued. Should the Licensee elect to file an answer
in accordance with 10 CFR 2.205 protesting the civil penalty, in whole
or in part, such answer should be clearly marked as an "Answer to a Notice
of Violation" and may: (1) deny the violation listed in this Notice, in
whole or in part, (2) demonstrate extenuating circumstances, (3) show
error in this Notice, or (4) show other reasons why the penalty should
not be imposed. In addition to protesting the civil penalty in whole or
in part, such answer may request remission or mitigation of the penalty.

In requesting mitigation of the proposed penalty, the factors addressed
in Section VI.B.2 of the Enforcement Policy should be addressed. Any written
answer in accordance with 10 CFR 2.205 should be set forth separately
from the statement or explanation in reply pursuant to 10 CFR 2.201, but
may incorporate parts of the 10 CFR 2.201 reply by specific reference
(e.g., citing page and paragraph numbers) to avoid repetition. The attention
of the Licensee is directed to the other provisions of 10 CFR 2.205, regarding
the procedure for imposing a civil penalty.

Upon failure to pay any civil penalty due which subsequently has been
determined in accordance with the applicable provisions of 10 CFR 2.205,
this matter may be referred to the Attorney General, and the penalty,
unless compromised, remitted, or mitigated, may be collected by civil
action pursuant to Section 234c of the Act, 42 U.S.C. 2282c.

The response noted above (Reply to Notice of Violation, letter with payment
of civil penalty, and Answer to a Notice of Violation) should be addressed
to: Mr. James Lieberman, Director, Office of Enforcement, U.S. Nuclear
Regulatory Commission, One White Flint North, 11555 Rockville Pike, Rockville,
MD 20852-2738, with a copy to the Regional Administrator, U.S. Nuclear
Regulatory Commission, Region I, and a copy to the NRC Resident Inspector
at the facility that is the subject of this Notice.

Because your response will be placed in the NRC Public Document Room
(PDR), to the extent possible, it should not include any personal privacy,
proprietary, or safeguards information so that it can be placed in the
PDR without redaction. If personal privacy or proprietary information
is necessary to provide an acceptable response, then please provide a
bracketed copy of your response that identifies the information that should
be protected and a redacted copy of your response that deletes such information.
If you request withholding of such material, you must specifically
identify the portions of your response that you seek to have withheld
and provide in detail the bases for your claim of withholding (e.g., explain
why the disclosure of information will create an unwarranted invasion
of personal privacy or provide the information required by 10 CFR 2.790(b)
to support a request for withholding confidential commercial or financial
information). If safeguards information is necessary to provide an acceptable
response, please provide the level of protection described in 10 CFR 73.21.

Dated at King of Prussia, Pennsylvania
this 9th day of January, 1998

1.
e.g., A Notice of Violation and Proposed Imposition of Civil Penalties in the amount of $210,000 was issued to
PP&L on June 20, 1997, in part, for a Severity Level II problem involving the misalignment of an EDG breaker and the
documentation of activities that had not actually been performed (EA 96-270).